Which Way Will Pike Sales Go This Year?

I love doing research on Pike Sales. I have followed and looked for patterns for the past 10 years.

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If you look at the chart closely you will see that Pike Sales take off at the beginning of the year and peak by June or July. The standard theory is that buyers don’t want to move during the school year and disrupt their kids. Usually the time to move is during the summer. From the time a buyer signs a purchase agreement until the time they close the deal is between 30 and 45 days. This puts the buyers who found their house in April closing in May or June about the time school is out. There is a secondary peak in sales although not as great usually in August, September and October.

The ten year chart gets pretty messy. Here is a chart that covers 2013 through now.

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Click picture to enlarge

In 2014 we ended December with a up note. It carried through to January of 2015 beating out the past two years. February pulled back to match February of 2014. My guess is that February 2014 was slow because of the snow. I imagine the same for 2015.

Currently there is a high number of Pendings in Pike. That means we are likely to see sales go up in April and May. I have noticed an increase in showings in the past two weeks with my listings. Talking to other agents I hear the same thing. I will be watching.

My next posting will be about showings in Pike.

Woods of Traders Point

There is a new housing development in the works called Woods of Traders Point.

Woods Of Traders Point

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It is located just north of 71st Street and Marsh Road on the west side of the street. The utilities and the roads have been in the works for the past few months. At this point the roads and curbs are in and lots are ready for sale. I drove through the development yesterday. The community will have 70 lots, some of which currently have “sold” signs on them. Experience tells me that this may not be the case. A lot of time developers and builders put “sold” signs up in advance to attract attention. No houses have been started…yet.

I talked to the developer last year. He told me that the price point would be between $250,000 and $350,000. He predicted that they would sell out in two years. I would love to see that but the math does not add up. At the time the price point was only 7 percent of the market in Pike Township. I predicted 4 years and probably longer. I based it on Timberview, a development that is about at the same price point at 46th and Raceway. It was started in 2006 and is about 80 percent done. About 80 percent of houses sold in Pike Township are under $150,000. Only 20 percent of houses sold are above $150,000. That means if you are selling a house above $150,000 you have lost 80 percent of your buyers. Now I will give you that brand new houses attract more buyers and the location of Woods of Traders Point is good BUT I noticed the following sign on the development yesterday.

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Click picture to enlarge

Now the price point starts in the 290’s. So, if I say that now their price point is between $300,000 and $350,000 we are now talking about only about 2 percent (21 of 1084) of the market in Pike Township. Although I knew Westport was going to be the builder, they are not a “name brand” builder. The local Westport salesperson did not know that Westport had built in Pike 15 years ago. He thought this was their first development in Pike. Westport built homes in Robertson Village at 41st and Guion Road. Their signs were there for years. For the most part these were starter homes. I was unaware that Westport built homes in the $300,000 price point.

One thing that would help is if Westport has a model home. There was no indication that they would.

As much as I want to see this as a successful housing development for Pike Township, only time will tell.

Short Sales In Real Estate

What is a short sale?
Short Sale Sign
In 2002 when I first started in real estate I attended Tuesday morning sales meetings where the three broker/owners would teach agents the business. One Tuesday morning, one of the Brokers asked the following question; “What is a short sale?” An agent without hesitation answered “Any sales that Dave Short made.” Dave Short was and still is a LONG time agent with the company. There was laughter in the room.

WRONG!

Definition: A short sale occurs when a property is sold and the lender agrees to accept a discounted payoff, meaning the lender will release the lien that is secured to the property upon receipt of less money than is actually owed.

Example: If the unpaid balance of a loan is, say, $100,000 and a property sells for $90,000, under a short sale the lender might accept $90,000 as payment in full.

Is it difficult to get a lender to let the seller do a short sale?
Let’s say you bought a house for $110,000 and because of the economy it is now worth $90,000 fair market value. You still owe $100,000 so this makes you “upside down” or “under water”. You can’t sell the house without taking a loss and you don’t have the money to cover your loan even if it sells for $90,000. Depending on the lender, they may say, put it on the market at fair market value and then we will talk OR I have had a lender tell me to put it on the market at fair market value and they would have it appraised and it can be sold for 90 percent of the appraisal. Most likely the lender will send you a short sale packet. It will contain numerous documents to be filled out by the owner and Realtor. If you have the patience and time to fill out all the forms and get the house on the market and if your Realtor can present a case on the fair market value of the house then most likely the lender will listen and OK it. I have had homeowners that wanted to do a short sale, took one look at the forms that the lender sent them and said “forget it.”

Why would a lender not do a short sale?
It is a matter of math. Suppose you owed the lender $100,000. If the lender takes the house through foreclosure, their costs to do so equal about 33 percent of the loan. That means it would cost them about $33,000 to take it through foreclosure. If the property was sold for $90,000 through a short sale, the lender would only lose about $10,000. Now suppose the fair market value of the house was $60,000 and $100,000 was what was owed to the lender. In this case it would cost the lender less to foreclose on the property.

What can happen during a short sale?
Just about anything! How about the first lender in the middle of a negotiated buyer deal sells the property to another lender. It happened. We had to start all over again with the second lender. Because it took so long for the seller to redo the paperwork for the second lender, the buyer wanted out of the deal. How about when the lender said that all offers had to be 90 percent of appraised value or better and the buyer’s agent insisted that I send an offer to the lender which was about 86 percent of appraisal. I will never forget when the lender called me and gave me a verbal whipping. She almost pulled the plug on the whole short sale. Eventually the buyer made a better offer and the sale went through.

Lenders are not easy to deal with. It is their money and if you don’t do things their way, look out.

Why do short sales take so long?
Short answer, lenders are under staffed. How many times have you walked into your bank and found a teller that you could do business with right away? My bank? I am always waiting in line. Same goes for their back office staff. Remember the robo signing ordeal? Another factor I see is that when a bank gets an offer on a short sale property, they may hold it for a month or two before they make a decision. They may think they will get a better offer. They don’t realize that the buyer will walk if they think the lender is stalling. There is an agent in our office whose short sale took 17 months to close. This is extreme. Fortunately the buyer stuck it out.

Just like regular real estate sales, every transaction is different. There is no rhyme or reason to short sales.

Is there a downside to short selling?
If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable. From calendar year 2007 to 2014 the Mortgage Forgiveness Debt Relief Act forgave that debt and it was not taxable. Consult the person that does your taxes for an answer in your case. I am not a tax expert or accountant.

Short Sale Chart

Asyou can see there were no short sales in Pike Township before 2009. Once the economy went south, lenders started allowing it. So far this year there are only 5.

Disclosure ; The raw dollar figures above in the article do not include closing costs which can vary. Some of the above information came from MIBOR’s Broker Listing Cooperative which is deemed reliable but not guaranteed. I am not an attorney, appraiser, tax expert or accountant. I am just an experienced and good Realtor. Selling houses is all I do.

Investor Housing

SignOne segment of my business is investors. Over the years I have dealt with a lot of investors and still do. Investors are looking for inexpensive housing that usually needs repairs and updates. They usually plan to flip (fix up and resale at a profit) or rent for a profit. The types of houses they are interested in I call distressed sales. My definition of distressed is bank owned, HUD owned, VA owned, foreclosed, short sales or bankruptcy homes. When I started in 2002 there were very few of these types of homes. Most of these type of homes needed lots of repairs that could cost anywhere from a few thousand dollars to over $20,000. It took a certain type of buyer that could pay cash for the home and fix it up. In many cases banks would not give loans on houses that were not immediately livable. At that time you could expect a 20 percent discount off market value for a distressed house listing.

DistressedChart

As you can see from the above chart, distressed sales climbed from about 5 percent in 2003 to about 35 percent in 2009. During this time there was a whole lot of new construction in Pike Township. You could get a new home with no money down and very low closing costs. The problem with new construction is that there are no property taxes the first year. Property taxes are usually included in the mortgage payment. By the second year property taxes get escrowed and make the mortgage payment s go up, sometimes as much as $200 a month. The homeowner can’t afford it and the home gets foreclosed on.

At the same time during that period, banks would do mortgages with no money down and if the buyer was breathing, they could get a mortgage. This brought out tons of buyers. In many cases the finances of these buyers was questionable and they probably should not have bought homes. The peak of the Pike market was in 2005. By 2007 the economy took a turn for the worst and distressed housing skyrocketed.

The market was flooded with distressed listings. Investors came out in droves. Prices dropped to sometimes 50 percent of what market value was in 2005. There was an extreme amount of flipping. At the same time non-distressed homeowners were losing all their homes equity because home values were dropping. In many cases they could not sell their homes and break even. Total sales in Pike went from 1642 in 2005 to 884 in 2010.

RentBuyBy 2010 there was a huge demand for rentals. Homeowners that had lost their homes during downturn could not buy new homes. They had to now rent until they could repair their credit which might take years. Real Estate Investment Trusts started coming into Indianapolis and buying 1000’s of homes. They were turning around and renting them. Even with strict guidelines about what they would buy based on return on investment, they bought many of the distressed homes on the market. They were not adverse to doing repairs and making the houses marketable to rent. In effect this took a lot of distressed homes off the market. At the same time it made a lot of homeowner associations pretty mad. They did not want rentals in their neighborhoods. This caused a lot of them to change their covenants to restrict rentals.

From 2011 with a high of distressed homes at 35 percent of sales to 2014 we dropped to 16.6 percent of sales. We are now currently sitting at about the same rate as at the peak of the market in 2005. The big difference is that in 2005 a total of 1642 homes were sold. In 2014 a total of 1083 homes were sold. I believe it will be a slow climb back to the sales level of 2005.

BLBottom line…it is harder and harder for me to find good homes for my investors. Yes, there are still distressed homes out there BUT the return on investment is getting squeezed. In the past when it was easy to get a reasonable profit on a house flip, now the numbers are getting harder and harder to work. With less distressed housing on the market the prices are getting higher and firming up. More and more when one of my investors makes an offer on a distressed house, there are multiple offers at the same time. If I don’t get my investors to the house the first day it is listed and make an offer, it will be sold quickly to another investor. That is why I review all new listings in Pike Township first thing every morning.

44 Moneymaking Tips For Preparing Your Home To Sell

HouseOnMoney

There’s no doubt about it: first impressions count with buyers. That’s why I prepared this 44 fail-proof list of simple, quick, and inexpensive things you can do to prepare your home to sale.
I divided them into three categories: 1) Exterior of home, 2) Interior of home, and 3) How to show your home for maximum profit.

Exterior Of Your Home

Overall, buyers are looking for a home that looks clean, neat, and well-maintained. By addressing exterior issues, you immediately give your buyers a positive “first impression.”

Here are 13 first impression items to examine:

 Tip #1: Get into your car and drive away from your home. Drive towards your home the way a potential buyer would. Notice your first impressions of your home. Is the landscaping well groomed? How about the driveway and curb? Can you easily see the architecture of the home, or is it blocked by trees and bushes. Notice your roof. Is it in good condition? Make a list of items that need attention.

 Tip #2: Paint your front door and mailbox. Polish your door and entry hardware.

 Tip #3: Make sure your doorbell is functional.

 Tip #4: Wash or thoroughly clean wood, aluminum, and vinyl sided homes. You can hire a contractor to pressure wash an entire house for about $200. Pressure washing can remove dirt, grime, peeling paint, and mildew.

 Tip #5: Rake leaves, trim shrubbery and trees, cut the lawn, and plant a few new, fresh flowers. Put down fresh mulch or peat moss around shrubs and flower beds.

 Tip #6: Sweep and hose off the walkways and driveways. Pressure wash if necessary.

 Tip #7: Clean the gutters and extend downspouts to prevent flooding or basement water seepage.

 Tip #8: Organize the garage. Get rid of clutter by either putting it in boxes, or pack ahead of time and rent a storage locker for your garage belongings. Make sure you wash your car.

 Tip #9: Check the locks of your home at both the entry, back entry, and garage. Locks can give a first impression of a home that needs maintenance. And they’re the first thing a buyer sees. A small dab of graphite will make them work like new.

 Tip #10: Clean oil stains from your driveway and garage. This is best achieved by using poultice with Portland cement. Scrub with a detergent and rinse. Clean rust stains beneath rails with the commercial product, Zud.

 Tip #11: Clean up any litter in the yard or walkways. Remove any leaves or debris in the yard or walkways.

 Tip #12: Touch-up the paint on the exterior of the home if necessary. In some cases, it pays to repaint the entire exterior if it hasn’t received a coat of paint in years. Hardwood trim on the exterior of the home can make or break its appearance. Make sure it looks clean.

 Tip #13: Look for any cracks in exterior plaster, and make sure they’re fixed and repainted to match exterior paint.

Interior Of Your Home

There’s a little known secret about home buyers that you need to know. People buy homes based on the emotional FEELINGS they get from the home. They fall in love, for example, with the kitchen or the master bedroom. Or perhaps the roaring fire in the family room fireplace touched off an old memory.

And while they’re viewing your home, they’re visualizing in their mind’s eye what it would be like to live there – the backyard barbecues they’ll host…Sunday dinners with family…college graduation celebrations of their children. Or simply relaxing in the backyard hammock.

It’s all about emotions. And if your home doesn’t feel right, you will quickly lose interest from buyers.

So remember this: Purchase decisions are EMOTIONAL. Once a decision to buy is made, we usually justify our purchase with logical reasons.

By staging the interior of your home right, you’ll encourage your buyers to stay. People buy with their eyes, ears and noses, and the longer they stay in your home, the greater the likelihood of an offer.

Here are 18 interior tips to help you “stage” the interior of your house so it feels like home to your buyers.

 Tip #14: The entry way sets first impressions. So make sure it’s in great condition with fresh paint and clean floors. If the entry tile floor has build-up, consider using a commercial stripper and re-waxing.

 Tip #15: Clear out about one-third to one-half of your furniture. You want your home to look uncluttered, and the rooms to feel open and bright. The average home has too much furniture for showing, and you need to move anyhow. So you might as well pack away any furniture that clutters any rooms in the home.

 Tip #16: Put away nick-knacks and items that make the home look overly personal to YOU. You do not want your buyer feeling that they would never fit in the home because it has so many of your personal items in it. Put away cluttered photos and other objects that will detract away from the home.

 Tip #17: Do a thorough interior maintenance review. Oil squeaky doors, tighten doorknobs, clean and repair ALL windows, and repair leaking taps and toilets. Look for chipped paint and cracked plaster or drywall that needs repairing.

 Tip #18: It is a good idea to have all windows professionally washed. And clean all window shades and blinds.

 Tip #19: Replace all burned-out light bulbs and clean lighting fixtures.

 Tip #20: GIVE YOUR HOME A SPACIOUS LOOK. If you’ve ever toured a model home, you’ve noticed that the home is spacious and bright. Make your home look the same by: 1) Clear out stairs and halls of clutter and excess furniture, 2) Clear counters in the kitchen and bathrooms, and 3) Make closets and storage areas neat and tidy.

 Tip #21: Make sure your home is clean by doing the following: 1) Shampoo carpets, 2) Clean washer, dryer, and laundry tubs, 3) Clean the furnace, 4) Clean the refrigerator and stove, 5) Clean and freshen the bathrooms. Hire a professional cleaning service if needed. The money you spend on these areas will come back to you in purchase price.

 Tip #22: Wax or polish floors, and glue down any seems if you have vinyl flooring.

 Tip #23: Make sure windows and doors operate properly and lubricate closet door tracks with a silicon spray.

 Tip #24: Glue loose wallpaper seams and remove soiled wallpaper.

 Tip #25: Clean around fireplaces and remove ashes.

 Tip #26: Organize all closets, pack up unnecessary items for storage, and put all toys away.

 Tip #27: Make sure all beds are made, bedrooms are neat and clean, and laundry is clean and folded.

 Tip #28: Consider holding a yard sale BEFORE you place your home on the market to get rid of excess items that can make your home look cluttered or small.

Bathrooms and kitchen are some of the most influential areas of a home. Spending a small amount of money in these areas frequently nets owners many times their investment. Here are a few suggestions for each.

 Tip #29: Your Bathrooms. Repair loose tiles. Remove loose grout using a grout file, and apply new grout. Faded tile colors can be improved using an epoxy spray. Remove old tub and tile caulking with a hooked scraper, install new white silicone tub, and tile caulk. Concentrate on areas such as counter corners, shower corners, and base of toilet. Clean mildewed caulk by spraying Tilex, or use diluted chlorine bleach and let stand for at least 30 minutes before rinsing. Old tubs can often be sprayed with an epoxy coating. Remove all soap scum and dirt build-ups. Again, diluted chlorine bleach will help here. Clean glass doors with vinegar, and replace badly soiled shower curtains. Don’t forget to vacuum exhaust fans.

 Tip #30: Your Kitchen. Clean ovens thoroughly. Clean cook tops and exhaust fans. Remember to clean behind your appliances. Double-check all burners to make sure they’re working. Defrost freezers, and thoroughly clean the interior of your refrigerator. Remove mold from refrigerator gaskets. Empty the water collection tray under the refrigerator. Neatly arrange soaps and cleaning accessories. Thoroughly wash fronts of cabinets using Murphy’s Oil Soap or Pine Sol. Cover counter burns with ceramic tile or heat resistant glass. Make sure all handles are securely in place. Install new shelf and drawer liners.

 Tip # 31: Save your receipts. If you need to make substantial repairs to your home, save the receipts in a manila envelope. This will show what has been updated in the home.

How To Show Your Home For Maximum Profit

There’s a right way to show a home…and a wrong way. Many homeowners lose money, or turn-off buyers because they simply didn’t know how to handle a home showing. Here are 13 tips that will help you show your home for maximum profit:

 Tip #32: Save those receipts. If you completed any substantial work on your home, save the receipts and ONLY take them out if someone questions the value of the work performed (in the negotiating process). Many times extra work will increase the value of your home beyond your costs. So only use the receipts if you need support to justify the work.

 Tip #33: Save those utility bills. Buyers frequently have questions about utility costs of owning a home. If you have past utility bills, you will greatly increase your credibility and help provide precise answers to important questions. Save electric, gas, water, oil, sewage, and waste management bills.

 Tip #34: Go away during organized showings. Three’s a crowd when your home is being shown. The only exception to this rule is if you have specific knowledge about features of the home a Realtor cannot answer. But in most cases, don’t stay.

 Tip #35: Turn on ALL lights. Illumination is like a welcome sign.

 Tip #36: Open all drapery and bring in as much natural light as possible. Buyers hate dark homes. Anything you can do to brighten your home will help.

 Tip #37: Turn off any radios and TV’s. Turn off the football game. Tell the kids that the loud music will need a reprieve while the home is being shown. Occasionally very soft, background music can enhance a showing. But generally, no music at all is your best bet.

 Tip #38: Plan a pleasant aroma. Cinnamon sticks or vanilla boiled in a pot of water on the stove emit pleasant aromas and make a home smell inviting. Apple and cherry wood smoldering in a fireplace do the same. And who can resist the smell of apple pie or fresh bread baking in the kitchen. Often, these pleasant smells can override other odors your home may have.

 Tip #39: Keep pets out of the home during showings. It’s best to keep them out of the home for an entire day before an open house.

 Tip #40: Do NOT volunteer conversation. Be courteous but don’t force conversation with a potential buyer. They want to inspect your home, not make a social call.

 Tip #41: Stay positive: Never apologize for the appearance of your home. Let the showing Realtor answer any objections – they’re trained to know how.

 Tip #42: DO NOT Tag Along. It makes buyers fearful and uncomfortable. The showing Realtor knows the buyer’s requirements and can better emphasize the features of your home. They will call you if needed.

 Tip #43: Never negotiate during a showing. Let your Realtor discuss price, terms, possessions, and other items with any potential buyers. If any negotiations arise prior to an offer, politely request the buyer to submit an offer and you can consider it.

Tip #44: Protect Your Largest Investment By
Getting REALTOR® Representation

The Way You Live In A Home And The Way You Sell A Home Are TWO Very Different Things!

Each year thousands of homeowners unnecessarily lose money when they sell their homes. They don’t lose money because someone took advantage of them. And they don’t lose money because it wasn’t “marketed” well.

Even Seasoned Homeowners Lose Thousands of Dollars
Because They Didn’t Know About The Important Factors
That Influence The Value Of Their Homes

If you desire to sell your home for top dollar, and in your time frame, you need to do two things: 1) Get control of your personal emotions about your home, and 2) Place yourself in the shoes of potential buyers. Look at your home the way they would, and make it appealing in the right areas.

I know that putting your “homeowner emotions” aside may be tough to do. But doing so will help you to position your home to sell for top dollar, and in your time frame.

After all, selling your home is very different from any other financial transaction. Your house isn’t just a “thing.” It’s your HOME!

It’s the place where you raised your children. The place where you hold countless family memories…Thanksgiving dinners, family reunions, birthdays, anniversaries and more. It’s the place where you solved problems over the kitchen table late at night.

So it’s no surprise that selling your home may involve a bit of sadness, fear…or even excitement for the next move in your life.

Try not to let these emotions get in the way of a prudent sale. The tips and suggestions in this report will help.

Here Are Six Problems Your Home May Have
That Can Instantly Turn Buyers Off

Potential buyers are much more likely to return to a home that impresses them at first glance, while homes that appear disorderly or poorly maintained seldom sustain buyer interest.

1. Home Odors. Because homeowners become desensitized to the odors in their homes, they rarely realize how obvious odors can be to visitors. This is particularly true of pet owners and smokers.

2. Carpet and Flooring. One of the most visible areas of your home is your flooring. If your carpet is worn or dirty, get it replaced or cleaned. If you have vinyl flooring with corners coming up, get it glued down. Special note: Replacing flooring in smaller areas, such as kitchens, with high quality flooring can bring in premiums in price.

3. Paint and Walls. Paint is one of the least expensive ways to “spruce-up” your home. Consider painting outside trim and interior walls and doors.

4. Clutter. Excess clutter is a big buyer turn-off. You have to move anyway, so you might as well pack away items that make your home feel good to you, but turn off buyers. This includes nick-knacks, furniture, pictures, wall hangings, plants, etc.

5. Signs of Pests. If you have any sign of mice, rats, roaches, spiders, or bees, you should immediately contact a local pest control company and have them eliminated. There’s no better way to show your home is filthy than by infestations. Remove all spider webs with a broom.

6. Landscaping. If your landscaping is messy, overgrown, or looks cluttered in any way, you need to fix it. Buyers make positive or negative conclusions about your home within the first five minutes. Don’t lose the battle before you’ve even begun.

Pike Home Sales – 2013 Vs 2014

Click Graph To Enlarge

Click Graph To Enlarge

The trend lines for sales are text book in the past two years. Sales start to take off in February and March. They usually peak out by June and July and slowing drift downward, usually with a second push in October. The thinking is that kids are back in school and on a regular schedule. Then sales trend downward until winter and the end of the year. This is the home sales cycle.

Currently there are about 500 homes for sale in Pike. Before 2007 there were always about 1000 homes for sale in Pike during the summer months. Not anymore. My theory is that during the years when interest rates were in the 3’s, a lot of home owners refinanced their homes and at the same time took all the equity out of their homes. Now they can’t afford to sale their homes without bringing money to the closing table.

Inventories being low and the demand being strong creates higher prices. Last year the average dollar per square foot of house was $65 in Pike. This year so far it is $76. The best houses in pike go quickly and at strong prices.

This time last year there were 788 houses sold in Pike. This year so far there are 734 houses sold. We are down about 7 percent. Last year there were a total of 1112 houses sold. This year my estimate is about 1000 houses sold. Although this is weaker than last year, it is strong compared to 968 in 2012, 849 in 2011 and 879 in 2010.

Pike High School Recognized by the Washington Post

Pike High School

Pike High School

​Please join us in congratulating Pike High School for being ranked 13th in the state on The Washington Post’s list of America’s Most Challenging High Schools! As you may recall, this is the 2nd year in a row that Pike High School has appeared on this prestigious list. Last year, they were ranked at #16. Congratulations to all of our hard working students, teachers, and staff on a job well done.

Sarah Dorsey
Communication Officer
MSD of Pike Township
sdorsey@pike.k12.in.us
Metropolitan School District of Pike Townnship

Augusta Heights, The Lost and Mysterious Community In Pike Township

Most Realtor’s I talk to think Augusta Heights is in the New Augusta area. It is not. It is in the 79th and Michigan Road area. It happens to be the southeast quadrant of that intersection. You can easily miss it. There are only a couple of ways to get to it. Just south of 79th and Michigan Road on the east side there is a street called Sapphire Blvd. If you follow it, it will take you into Augusta Heights. Just east of 79th and Michigan Road there is a street called Walnut Drive. If you turn south on it, it will also take you into Augusta Heights. If you look at a plot plan of Augusta Heights you will see other streets going into Augusta Heights. If you try and find the streets, they are not there. They were never built. There are 403 plotted lots in Augusta Heights but only 38 have houses/businesses on them. These improvements were built anywhere from 1927 to 2000. They are scattered throughout.

Fun Fact – Some members of Pike Township Residents Association call Augusta Heights the “Jewel District of Pike Township” because most of the street names are jewels.

Here is a location picture of Augusta Heights showing the plots

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Click To Enlarge

In 2000 which was the last time a house was built in Augusta Heights, the owner had to get a zoning variance before they could build. This had to do with putting in a septic system. It seems the city did not want new housing on septic. All new houses had to be on city sewer or you had to get a variance. Since there are no sewer lines or city water lines in Augusta Heights, the cost of putting in city utilities would be prohibitive. They petitioned the city for a variance. They got it and built.

Around this time Crossman Communities, a home builder, was buying up lots in Augusta Heights. There was lots of speculation about what they were going to do with the 244 lots and 3 houses that they bought. In 2002 Beazer, another home builder, merged with Crossman Communities. Both home builders at the time were active and starting communities and building in them in Pike Township. Nothing ever happened in Augusta Heights. I speculate that again the cost was too prohibitive to bring in city water and sewer.

In 2008 there was a letter sent out to Augusta Heights’ home owners. Because an Augusta Heights home owner was a client of mine and I had sold him several investment homes, he emailed me a copy and wanted to know what I thought. The letter appeared to be a letter of intent. Rumor was that they wanted to build a commercial center in Augusta Heights. Well, nobody wanted that. There were not enough details in the letter to figure out how they were going to do that. Again, nothing ever came of it.

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Click To Enlarge

I don’t know the beginning history of Augusta Heights or how and when it got plotted. It must be interesting. I had heard rumors that the State Fair at one time gave away plots of land in Augusta Heights as prizes. I have no idea if this is true but it makes a good story. I do know that there is a lot of encroachment (houses to near or on property lines) in Augusta Heights. You can see this in aerial views. Encroachments are a Realtor’s nightmare. They usually have to be resolved before properties can be sold.

Last week I was driving along 79th in the Augusta Heights area when I saw this sign

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Click To Enlarge

It appeared that Crossman Communities properties in Augusta Heights were going to auction. I had mixed emotions about this. Obliviously Crossman/Beazer wanted to get rid of the properties. They had held on to them for years without any income. They were now going to do it the fast way and probably take pennies on the dollar. Finally, something was going to happen to these lots. The downside was that there might be 50 new owners in Augusta Heights. How many of them had done their due diligence about all the challenges they would face. Here are a few;

Encroachments.

The lots are extremely small. 5000 square feet or .11 of an acre. Most new home lots are twice that size in Pike.

Some lots are in flood zones.

Petitioning the city for variances for septic and the costs involved.

Roads that need to be built so that you can get to the properties.

I would guess that financing would be near impossible and all sales would have to be cash.

He is a picture of the lots that are for sale. Remember, there are no roads to some of these lots

Click To Enlarge

Click To Enlarge

On Friday the 25th I went to the inspection/preview of the 3 homes for sale. It appeared that all 3 homes had sit empty for years and were in need of major repairs. They were not livable in their present condition. Two of the three houses were brick, solid and appeared to be in good condition from the outside. Inside was a different story. Mold, roof leaks, wet basements, missing drywall, missing copper piping, no furnace or water heater and the list goes on and on. According to the property tax records, one of the houses was built in 1947. The other 2 did not have build dates. Houses that were built in this period have very small closets, small kitchens, limited bathrooms and small bedrooms. Not suited for today’s buyers. I am always leery about old houses. You never know what could go wrong. There were quite a lot of people looking. My guess was that most of them were contractors that were looking for a cheap buy, fix up and flip or rent. The challenge would be do you fix up and update or would you gut the whole interior and start from scratch. Here is where economics come into play. Houses along 79th Street in the Augusta Heights area go for around a price point of $100,000. In the condition these houses were in you might have to put $50,000 into to make marketable and it could a year’s worth of work. Very little incentive unless you planned to live there and that would be a challenge in the beginning. The rental houses in the area go for around $1200 a month. Renting on 79th Street would be a hard sell because of the traffic and you might have to take considerable amount less to rent. I can think of numerous better places in Pike to rent for that kind of money.

According to the auctioneer who was present at the inspection, it will be an open to the public auction. You do not have to be a bidder to attend. Bidders will have to put up a $5000 check to bid and $10,000 to bid on the lots and will have to pay a 10 percent buyers premium. It is not an absolute auction, a type of auction where the sale is awarded to the highest bidder. Absolute auctions do not have a reserve price which sets a minimum required bid for the item to be sold. My understanding is that there will be 3 sections and you have to bid on a section. A section could contain around 70+ lots and, interesting twist, Crossman/Beazer will have 3 days to decide if they will accept the bid.

I wanted to attend the auction but I have an appointment at the very same time. I was curious who was bidding and how they were bidding.

It will be interesting to see how this whole thing turns out. I am disappointed that the City has not stepped in and faced the challenges of Augusta Heights. I have a feeling that in time it will come to haunt the powers to be.

If it had been done right from the beginning there would have been city utilities, roads and many access points in Augusta Heights. Property values would be somewhat stable in a hidden and much wooded area in Pike Township. Now only time will tell.

Relevant Links
Augusta Heights Plots Picture
Paragon Letter On August Heights Dated 9/19/2008
Key Auctioneers Auction Flyer Showing Auction Lots
Key Auctioneers Lot Measurements
Key Auctioneers Survey of Augusta Heights

Disclaimer – The above story is deemed reliable with the facts but not guaranteed. My sources are:

A client of mine who owns improved property in Augusta Heights

Metropolitan Board of Realtors (MIBOR) property tax records

Conversations with past Township Administrators

My firsthand account of inspection/preview of the improved properties to be auctioned

A conversation with the auctioneer

My opinions as a 12 year Realtor specializing in Pike Township

Seeing firsthand presentations about Augusta Heights zoning petitions at Pike Township Residents Association